It seems to me that one possible outcome would be for that rather localized party to end with valuations there returning to sustainable levels, while the rest of the market is less affected.
The GFC was a result of individuals taking on massive amounts of debt in aggregate. Corporate America has similarly taken on a lot of debt over the last decade for buy backs and growth. As the author of the article notes, the last 10 years have been great for cheap debt. Negative balances are still a risk and rates are going up. The companies taking on the most risk in terms of debt are for the most part not traditional tech. Think Chevron, GE, and other industrial and energy companies. I'd conclude that the majority of the economic risk is in fact not concentrated in FAANG or even most of tech, but elsewhere in the economy.
That doesn't mean some tech companies won't get caught in the storm. I think we could very easily see a couple mid-size players go the way of Yahoo (the Snaps and Ubers).
You mean, precisely what would be considered 'traditional tech' in any sane world? :P
Industrial and energy companies have a much larger and more important impact on the economy than information technology.
We live in the strange topsy turvy world where 'information technology' has somehow been narrowed to "that guy who fixes your computer and administrates the servers" and 'tech' narrowed to mean what 'information technology' should.
It's actually more absurd than you note: "tech" today means "Internet tech", and people have largely forgotten that less than a generation ago IBM, HP, Sun, Oracle, Intel, AMD, and Microsoft were all "tech" companies. (You'd have to go back two generations for Chevron and GE to be "tech".) But that's the nature of psychology. Everything that was around when you were a kid is just part of the natural order of things, while the only new and exciting technology is the stuff you just heard of in the last year or two.
(It's pretty likely the pendulum will shift again in a year or two, and FAANG will no longer be tech, which will be reserved for crypto[currency - this is another good example, where if you're > 30 'crypto' means 'encryption' while if you're < 30 it means 'cryptocurrency'], robotics, self-driving cars, drones, and AI.)
There's a major industry that for some reason people don't mention these days when they are imagining where the future is coming from, and I find it entirely inexplicable that it just doesn't register.
If I told you what it is, you probably would find it too obvious in retrospect, so I won't. I am over 30 BTW. And no, it's not green energy.
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